3. The cost of preferred stock Preferred stock is a hybrid security, because it has some characteristics typical of debt and others typical of equity. The following table lists various characteristics of preferred stock. Determine which of these characteristics is consistent with debt and which is consistent with equity, Debt Equity Characteristics Dividends are fixed Failure to pay a preferred dividend does not send the firm into bankruptcy. Consider the case of Bogdan Enterprises: At the present time, Bogdan Enterprises does not have any preferred stock outstanding but is looking to include preferred stock in its capital structure In the future. Bogdan has found some institutional investors that are willing to purchase its preferred stock issue provided that it pays a perpetual dividend of 513 per share. If the investors pay $100.15 per share for their investment, then Bogdan's cost of preferred stock (rounded to four decimal places will be 3. The cost of preferred stock Preferred stock is a hybrid security, because it has some characteristics typical of debt and others typical of equity. The following table lists various characteristics of preferred stock. Determine which of these characteristics is consistent with debt and which is consistent with equity. Debt Equity Characteristics Dividends are fixed Failure to pay a preferred dividend does not send the firm into bankruptcy. 12.3315% Consider the call Enterprises: 14.2786% At the present 15.5766% Enterprises does not have any preferred stock outstanding but is looking to indude preferred stock in its capital structure In the future. B find some institutional investors that are willing to purchase its preferred stock issue provided that it pays a perpetual 12.9805% dividend of $13 the investors pay $100.15 per share for their investment, then Bogdan's cost of preferred stock (rounded to four decimal places) will be